PAYG instalments for primary producers and special professionals

Pay as you go (PAYG) instalments are used to collect amounts towards your expected tax liability on your business and/or investment income during the income year.

Your actual tax liability is worked out at the end of the income year when we assess your annual tax return. Your PAYG instalments for the year are credited against your assessment to work out if you need to pay more tax or are due a refund.

The dates given are based on a balancing date of 30 June, which is when the majority of taxpayers in Australia balance their accounts.

Quarterly instalments

If you prefer to pay quarterly instalments, you will need to work out your PAYG instalments based on your instalment rate multiplied by your instalment income, being your business and investment income.

To do this, you pay a proportion of your instalment income for the quarter. You work out the amount to pay using your instalment rate, which is shown on your activity statement. If you pay quarterly and your circumstances change you can vary your instalment rate.

To work out your quarterly instalments use:

Instalment income ($) × instalment rate (%) = instalment amount ($)

If you are eligible to pay two instalments and you choose to pay the amount worked out for you by us, you cannot choose to pay quarterly instalments.

If you want to pay quarterly instalments instead of two quarterly payments, you must notify us of this change by the date your first instalment would be due. If you don’t advise us by the due date, you will continue to pay two instalments per year.

The due date for the first quarter is on or before 28 October.

If you choose to pay quarterly using the instalment rate multiplied by your instalment income, you must continue to do this unless your circumstances change or you advise us that you no longer want to pay quarterly.

Two instalments

Some primary producers and special professionals can pay two instalment amounts per year. You are eligible to pay two instalments in an income year if all of the following apply to you:

you are a quarterly PAYG instalment payer and have decided to pay an amount worked out for you by us

you are an individual carrying on a primary production business or you are a special professional, such as an author, inventor, performing artist, production associate or sportsperson

your gross primary production income or special professional income was more than your deductions for that income on your most recent tax return, that is your net income from that income source in your most recent assessed income year was at least $1.

To work out your net income:

any carried forward losses are ignored

net farm management deposits and withdrawals are included if withdrawals exceed deposits.

We will tell you if you are eligible to pay PAYG in two instalments.

If you pay two instalments, we work out your instalment amounts for you using your gross domestic product (GDP) adjusted notional tax. You pay 75% of your GDP adjusted tax by 28 April and the remainder by 28 July.

If you choose to pay instalments using the amounts worked out by us, you must continue to do this unless your circumstances change or you tell us you no longer want to pay in two instalments.

Annual instalment

An annual instalment is one lump sum payment toward your expected tax liability on your business and investment income for the income year.

You are eligible to pay PAYG instalments annually if you are an individual and the following conditions apply:

your most recent notional tax was less than $8,000

if you are registered for goods and services tax (GST), you report and pay GST annually

if you are a partner in a partnership registered for the GST, the partnership reports and pays GST annually.

We will tell you if you are eligible to pay PAYG annually.

If you are eligible to pay annually and want to do so, you must advise us by the date your first quarterly PAYG instalment would be due. If you don’t tell us by this date you will have to pay quarterly instalments.

When it is time to make your annual payment, we will send you a notice telling you how much to pay. Payment is normally due on 21 October following the end of the income year.

If you choose to pay annually, you must continue to do this unless your circumstances change or you tell us you no longer want to pay annually.

Our commitment to you

We are committed to providing you with accurate, consistent and clear information to help you understand your rights and entitlements and meet your obligations.

If you follow our information and it turns out to be incorrect, or it is misleading and you make a mistake as a result, we will take that into account when determining what action, if any, we should take.

Some of the information on this website applies to a specific financial year. This is clearly marked. Make sure you have the information for the right year before making decisions based on that information.

If you feel that our information does not fully cover your circumstances, or you are unsure how it applies to you, contact us or seek professional advice.